IRA Plan Services in Kings Point NY

Individual Retirement Accounts (IRAs) are powerful tools designed to help individuals save for retirement in a tax-advantaged manner. Whether you're looking to maximize your savings through employer-sponsored plans or exploring options for your children, understanding the different types of IRAs and their benefits is crucial.

Types of IRAs

Traditional IRA

A Traditional IRA allows individuals to contribute pre-tax dollars, which can grow tax-deferred until withdrawals begin at retirement. This option is ideal for those who anticipate being in a lower tax bracket in retirement.

  • Contribution Limits: Up to $6,500 annually for those under 50, with an additional $1,000 catch-up contribution for those over 50.

  • Tax Advantages: Contributions may be tax-deductible, reducing your taxable income.

  • Withdrawal Rules: Required minimum distributions (RMDs) begin at age 73, and withdrawals before age 59½ may incur penalties.

Roth IRA

A Roth IRA is funded with after-tax dollars, allowing your investments to grow tax-free. Withdrawals during retirement are also tax-free, making it an excellent option for those expecting to be in a higher tax bracket later in life.

  • Contribution Limits: Same as Traditional IRAs, with income limits for eligibility.

  • Tax Advantages: No taxes on withdrawals of contributions or earnings, provided certain conditions are met.

  • Withdrawal Rules: No RMDs and contributions can be withdrawn at any time without penalty.

SEP IRA

A Simplified Employee Pension (SEP) IRA is tailored for self-employed individuals and small business owners. It allows for higher contribution limits than Traditional and Roth IRAs.

  • Contribution Limits: Up to 25% of compensation or $66,000 annually, whichever is less.

  • Tax Advantages: Contributions are tax-deductible, and the plan is easy to administer.

  • Withdrawal Rules: Similar to Traditional IRAs, with penalties for early withdrawals.

SIMPLE IRA

A Savings Incentive Match Plan for Employees (SIMPLE) IRA is designed for small businesses with 100 or fewer employees. It offers a straightforward way for employers to contribute to their employees' retirement.

  • Contribution Limits: Up to $15,500 annually, with a catch-up contribution of $3,500 for those 50 and older.

  • Tax Advantages: Contributions are tax-deductible, and employers must match employee contributions.

  • Withdrawal Rules: Early withdrawals within the first two years of participation may incur a 25% penalty.

Backdoor Roth IRA Conversion

For high-income earners who exceed the income limits for a Roth IRA, the Backdoor Roth IRA conversion is a strategy worth considering. This involves contributing to a Traditional IRA and then converting those funds to a Roth IRA.

  • Contribution Limits: Make non-deductible contributions to a Traditional IRA, then convert to a Roth IRA.

  • Tax Advantages: The conversion amount is taxable, but future growth and withdrawals will be tax-free.

  • Benefits: Allows high-income individuals to enjoy Roth IRA benefits even if they don’t qualify directly.

Roth IRA for Minors

A Roth IRA can be an excellent tool for minors to start saving for their future. As long as a child has earned income, they can
contribute to a Roth IRA, benefiting from decades of tax-free growth.

  • Contribution Limits: Up to the lesser of $6,500 or the child’s total earned income.

  • Tax Advantages: Contributions grow tax-free, and withdrawals in retirement will be
    tax-free as well.

  • Long-Term Benefits: Starting a Roth IRA early can provide significant compound growth over time, making it a valuable gift for your child’s future.

IRA Services in Kings Point, NY

At Siminou Wealth Management, we offer comprehensive IRA services tailored to your unique financial situation. Whether you're looking to maximize your retirement savings or establish a Roth IRA for your child, our team is here to help you understand your options so you can make informed decisions.

  • Personalized IRA Strategies: We help you choose the right IRA based on your financial goals.

  • Roth IRA Benefits: Learn how a Roth IRA can provide tax-free income in retirement.

  • Backdoor Roth Conversion: Maximize your retirement savings even if you exceed Roth IRA income limits.

Frequently Asked Questions (FAQs)

What is the difference between a Traditional IRA and a Roth IRA?

The main difference lies in how they are taxed. Traditional IRAs offer tax-deferred growth, with contributions potentially tax-deductible, while Roth IRAs offer tax-free growth, with no tax deductions on contributions.

Can I contribute to both a SEP IRA and a Roth IRA?

Yes, you can contribute to both, but the total contributions across all IRAs must not exceed the annual limit.

Are there penalties for withdrawing from an IRA early?

Yes, early withdrawals from a Traditional or SEP IRA may incur a 10% penalty, while early withdrawals from a SIMPLE IRA may incur a 25% penalty within the first two years. Roth IRA contributions can be withdrawn anytime without penalty, but withdrawing earnings before age 59½ may result in penalties.

Have Questions About Your IRA?

Understanding the various IRA options is essential for building a secure retirement. Whether you're self-employed, a small business owner, or looking to start saving for your child's future, Siminou Wealth Management offers the expertise and personalized service to help you achieve your financial goals.


For more information or to schedule a consultation, contact Siminou Wealth Management today. We're here to help you make informed decisions about your retirement savings.

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